Yasuhide Kobayashi, Sony Japan studio VP and The Last Guardian development boss, has stated that Japanese developers must focus their efforts on capturing the hearts of Western gamers or suffer an untimely death.
"There are so many issues we have to solve, and the biggest challenge is that the market in Japan is shrinking -- they key is gaining success in the US and Europe," he explains. "At the time of the original PlayStation the Japanese market was one third of the global market, and production costs weren’t that high -- so we were able to generate profit from that market alone.
"But now we’re in the era of the PlayStation 3, and the Japanese market is only one fifth of the global market -- when it comes to production costs, those are swelling, so it means that unless we gain success in the overseas market our studio will go bankrupt. It’s a crisis we recognize."
According to Kobayashi, The Last Guardian was named specifically to appeal to Western and European consumers. Surely they should have called it Guardian of War: Blood Sex if they wanted to do that.
Is the Japanese market really shrinking, or is the global market getting bigger, merely making Japan look small? There is always a lot of doom and gloom surrounding the Japanese game industry, but I sometimes wonder if the panic is overblown Even if it is, however, Kobayashi is certainly right to suggest that games need global appeal these days. The industry is a worldwide thing now, and simply making Japanese games for Japanese people isn't how you do good business.
VIDEO.DESTRUCTOID | JAPANATOR | TOMOPOP
11:20 AM on 09.17.2009 
Capcom and Square Enix have embraced this.